Greek Fire, Part 17

Psst.  Hey you.  While Greece is on fire and burning a hole though the Euro like thermite through the steel deck of a boat, gold's up to $1,200 an ounce and rising.

Gold rose toward $1,185 an ounce on Thursday and held near record highs in euro terms on fears Greece's debt issues may spread, with cautious comments from the European Central Bank doing little to temper risk aversion.

In remarks after the ECB left interest rates at 1.0 percent, its chief Jean-Claude Trichet ruled out a Greek default, but added officials did not discuss buying government bonds to cut euro zone members' borrowing costs.  

Ruled out, huh?  Don't think you can actually do that without the money to back that up, JC.  Just sayin'.

"Despite the ECB, being confident that default for Greece is 'out of question', the market seems to be nervous," said Pradeep Unni, senior analyst at Richcomm Global Services.

"At this point in time, it is becoming evident that investors are hedging the recent euro zone and UK crisis equally in gold and the U.S. dollar," he said. 

Nooooooo.  Really?  Looks like another confidence crisis is brewing, folks.  The smart money is betting against Greece being able to pay back a damn thing.  The Greek Fire keeps on burning, and nothing is going to put it out...not even a lake of molten gold.